California EDD suspends new unemployment applications for 2 weeks to address fraud, backlog

California EDD
Source: California EDD/Flickr

The California Employment Development Department (EDD) is suspending new applications for unemployment benefits to address its existing backlog problems and to reduce fraud.

The decision comes after the newly-formed Strike Team released its report, which included recommendations to solve the problems confronting the agency.

In July, Governor Gavin Newsom established the Strike Team to help improve the systems of the California EDD amid mounting complaints from jobless Californians waiting to receive their benefits.

Since the start of the COVID-19 pandemic, millions of Californians lost their jobs. The California EDD struggled to process the influx of unemployment applications because it has an antiquated system, which created an unacceptable backlog.

In addition, scammers took advantage of the situation by submitting fraudulent unemployment claims to the agency. California law enforcement authorities recently busted a large-scale unemployment fraud ring, which operated out of the San Mateo County Maguire Correctional Jail. They also recently arrested 44 people involved in submitting fraudulent unemployment claims using stolen identities.

California EDD Director Sharon Hillard informed Gov. Newsom regarding the agency’s immediate response to address the problems and to expedite new claimant payments.

California EDD to implement a new identity verification tool

The agency said it will implement, a new identity verification tool to strengthen the application process to prevent fraud. It will require applicants to upload identifying documents and a self-photo. It will validate the documents through multiple data sources at the applications point to stop scammers earlier than its current follow-up process involving notices through the mail.

To reduce the backlog, it will assign its most experienced staff to work on the oldest and most complex claim. It will redirect new staff to process mails, emails, and to call claimants for additional information to resolve their cases. Its goal is to reach zero backlogs by January 2021.

“I thank the Strike Team for their expertise and diligence in helping us closely examine our processes and challenges during this historic pandemic. We agree with the team’s recommendations and have already implemented some of them and are quickly adopting others to help eligible Californians receive the valuable financial support they need,” said Hillard in a statement.


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